When police made a series of dawn raids on houses across Slough last week, it was hailed as a blow against modern-day Fagins who were parting poor Roma children from their families and forcing them into a life of crime.

The media was invited along as officers wearing body armour smashed down doors and carried children away - apparently to safety. The face of one of these children appeared on a tabloid front page the next day under the headline: "Fagin's heirs".

The police officer in charge of the operation, Commander Steve Allen, told reporters: "We have evidence that organised crime networks are exploiting and driving the most vulnerable members of their own community."

But within days what seemed a spectacular success had begun to unravel.

In the nine days since the raid all but one child has been returned to the Roma community in Slough, according to a Romanian diplomat, and none of the 24 adults arrested at the scene has been charged with child trafficking offences.

Now a senior diplomat at the Romanian embassy has told the Guardian that the raid which claimed to have cracked a child trafficking ring was a "fiasco" and "a failure". The high-ranking official said he feared the operation, which involved 400 police officers breaking into 17 addresses simultaneously at dawn on January 24 and resulted in 10 children briefly being taken into care, was part of an anti-Romanian trend in Britain.

Fifteen adults have since appeared in court: nine were charged with minor immigration offences dating back seven years or more. Three were charged with theft of mobile phones, two with handling stolen mobile phones and the last with breach of a deportation order. So far just one man, Gheorge Mazarache, 25, has been jailed: he received an eight-week sentence after he admitted handling a stolen mobile phone worth £430.

Explaining the anticlimactic charges, Allen said: "I'm not able to see into the future. I didn't know exactly who and what we were going to find in those addresses."

Now the Romanian embassy wants the Metropolitan police to explain what went wrong. The senior diplomat said: "The main aim of the operation, as far as I have understood from the official declaration from the police and in the newspapers, was to disrupt Romanian traffickers and Romanian trafficked children. At the end of it all I can say, based on concrete statistics and concrete data provided by the British authorities, is there is no one accused of trafficking, but a few people accused of stealing mobile phones and some ancient immigration offences. How did the exaggeration of the gravity of offences happen? It is not the same to be involved in trafficking or child slavery as the attempted theft of a mobile phone."

Staff from the Romanian embassy claim they have not been allowed access to 15 Romanian nationals in police custody. "If a British citizen is arrested in Romania they are seen by someone from the British embassy within 24 hours, but it is not the case for us here," said the diplomatic source.

He criticised the Metropolitan police for tipping off the media. "They must do big operations all the time, but why publicise this raid involving Romanians?" he asked. "Unfortunately for our image, bad news about Romanians sells well. The media reports so rarely about good things that Romanians do." Too often Romanians were scapegoats for society's problems, he added. Initial reports gave the impression that the 10 children taken in the raid - one of whom was less than a year old - had been living with gangmasters rather than their families.

But the diplomat said that six were back in the Roma community in Slough within 48 hours. Some of these were returned to their parents and some to other adults social services deemed "responsible". Just one girl, who sources say is around 14 years old, is yet to be reunited with her parents because social services have so far been unable to trace any of her family members.

No one has yet been charged with trafficking offences, although two sources involved in the operation told the Guardian it would be wrong to conclude no child trafficking was involved just because no one has been charged with that offence. They say mounting such prosecutions are complex and would put the children involved in distress, and so it is better to prosecute adults for other offences. Police say they believe children were trafficked. But the diplomat said it was "hard not to conclude that the operation was a failure - it did not achieve its objectives. It seems to have been a fiasco."

Whatever the truth is in this case, it has certainly given national prominence to the Roma community in Slough, where huge extended families have moved into multiple properties on a cluster of streets within five minutes walk of each other since Romania joined the EU in January 2007.

Slough has long been a favourite destination for Roma. Before Romania's accession to the EU the district had a famously liberal approach to asylum seekers, and many Roma arrived in the town claiming political persecution after the collapse of communism. Many families involved in last week's raid had lived in Slough in the late 90s. They were deported when the UK tightened up its immigration rules, but they returned when the borders were opened.

The Roma's very visible presence has caused consternation in the local community. They complain that the high density of Roma living in nearby properties has led to problems with antisocial behaviour and crime.

Azeem Khan, 40, who lives next door to one of the raided flats in the Chalvey area of Slough, said the noise from the "18 to 20" Roma living in the adjacent one-bedroom flat was so unbearable that his wife, Saima, 34, developed eclampsia while pregnant with their daughter, now six months old.

He said the Roma were noisy, dumped their rubbish everywhere and hung around in "intimidating" gangs on the street. He said he was not surprised to hear they had allegedly been involved in criminal activity. "None of them ever go out to work, yet they have nice cars and you see them eating takeaway food every night," he said.

Suspicion around how the Roma pay for their lives and extensive families was rife this week, when the Guardian spent two days in Chalvey. Residents claimed to have seen the Roma women wrapping up dolls in shawls to use as "baby" begging tools, and said the children often stole sweets from the shops.

A shopkeeper told the Guardian he was always having to tell the children off for shoplifting. His wife said the children, as young as four, came into the shop "all the time", often with no shoes on. "There was a little girl in last week with no trousers or pants on, even in this weather," she said. Many residents complained that they were always seeing Roma going to the toilet on the street, and that house prices had plummeted in the area as a result.

Last night Scotland Yard would not comment directly on the diplomat's criticism, but stood by its actions. In a statement, police said: "We worked in close partnership and cooperation with the Romanian embassy and the Romanian government. Romanian police officers from the embassy were with us on the day of the operation. We have received no formal complaint from the Romanian embassy."

But the Roma believe they are being persecuted and are angry at their treatment. On Alexander Road, where two houses were raided, a large crowd of Roma gathered and shouted, in Romanian with bursts of broken English, how angry they were at the police and the "lies" in the media.

One young man in his early 20s said: "They came into our houses early in the morning, they broke down our doors, took away the children and told the world that the children - our own children - were not ours and that we had stolen them and trained them to commit crime. But now the children are back with us and we are very, very angry," he said. A Roma woman drew a young boy close to her and shouted across the road, "Would you send your child out to commit crime? I wouldn't."